The free-rider problem arises when:
a. goods cease to be scarce
b. goods are produced by the government.
c. goods can't be provided exclusively to paying customers.
d. the marginal benefit to a private individual outweighs the marginal cost of producing a good.
c
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Which of the following has been confirmed by empirical tests of the Ricardian model?
A) All predictions of the model for a multi-product, multi-country world are highly unrealistic. B) The existence of nontraded goods results in a high degree of specialization among countries. C) International trade has no impact on income distribution. D) The unimportance of economies of scale as a cause of trade. E) Companies tend to export goods in which they have a relatively high level of productivity.
Demand will be more elastic when
a. the time the consumer has to adjust to price changes is short. b. the price of the good is low. c. the number of good substitutes is large. d. the consumption of the good is essential.